AS we look back on the bailout years from the vantage point of our exit, there will be further calls for a wide-ranging enquiry as to why our banks failed us so badly.
While we’re at it we should enquire, also, why our media failed us so spectacularly.
As Minister Michael Noonan said recently in a Morning Ireland interview on our bailout exit, RTÉ had doom-mongers on from “dawn till dark” telling us to cut our losses and default.
He returned to the theme last Friday during an interview for Bloomberg in London, referring to academic economists on TV and radio advising Ireland to “throw in the towel and default.”
“We won the argument,” he said, though it was, in fact, the previous government which guaranteed the banks and entered the bailout while the finance spokesperson of his own party, Richard Bruton, seemed to be suggesting a partial default.
But that is not the issue here. What is far more serious is the fact that so many of the voices in the media lobbied against the State’s best interests at our time of greatest economic peril. Many of them were motivated by no higher calling than selling their product.
“Default, they’re all a shower of lousers, we’re ruined,” had so many selling points it was hard to resist. We all love to play the victim and we all love horror.
This is a lesson media barons have understood for a long time, as I’ve just learned from Jeremy Paxman’s new book on the First World War, Great Britain’s Great War. In 1910 there was a frenzied appetite for stories about an imminent German invasion. The Daily Mail commissioned a serial thriller from one William Le Queux called “The Invasion of Britain”, but when it was delivered it disappointed the paper’s owner Lord Northcliffe. He had the invasion rewritten to flatten all the towns in which the paper’s sales needed a boost.
Some private media organisations and the appetites they gratify will always sink as low as our appetites. The really serious nub of this story for us is that during the greatest economic crisis we have ever faced as a nation, the dominant voices on our national broadcaster, which is paid an annual licence fee by over a million homes, advised the State to default.
RTÉ didn’t make a state-of-the-nation address. But doom-monger pundits were indeed on “from dawn till dark”, prescribing the wackiest medicine to this ailing State. They were rarely asked a searching question such as, “What will be the probable consequences of a total bank collapse?” or “How poor will be if we can’t borrow?” or “Just how many special needs assistants will lose their jobs then?” or “What will cancer services look like?”
I don’t believe anyone in RTÉ ever enquired into the backgrounds of some of these “experts”. Did any of them have something to gain if the State defaulted? Did any of them have particularly large debts on property, for instance? But as the late Garret FitzGerald speculated, the damage done to our international reputation by these peddlers of default was “incalculable” because we are such a small economy that ratings agencies don’t bother to develop their own expertise on us.
It is true that most of the opposition played the default card gaily, and many didn’t know any better than to play it. The Labour Party’s then finance spokesperson, Joan Burton, recently told RTÉ’s Sean O’Rourke that she had never said she would walk away from any commitments made by the State, but I heard her say on RTÉ before she entered government that she would “unpick” the bank guarantee.
She warned before it was established that Nama — which is a bog-standard asset management agency — would make Brian Lenihan “a property czar of the largest property company on Earth”. Presumably that is the title that Michael Noonan now enjoys.
RTÉ had to reflect what the opposition was saying. But it didn’t stop at that. RTE broadcasters actually went as far as to editorialise, denouncing Government policy and promoting default.
Michael Noonan made this point to Bloomberg last week, when he spoke of default being “promulgated by very popular broadcasters”. The point was also made trenchantly by the late Garret FitzGerald in what was possibly his last interview with RTÉ, with Aine Lawlor on Morning Ireland in 2011.
Without a doubt the most shocking abdication of responsibility by our national broadcaster was the Liveline radio programme on Sept 18, 2008, in the crucial run-up to the bank guarantee. This was described to the Indo by a senior figure in Irish banking as “absolutely RTÉ’s single most destructive broadcast ever”.
There was already a run on the banks, but Liveline turned it into a stampede by fanning hysteria with seemingly no concern for the consequences. People were interviewed who said their fear of a banking collapse had made them hide their money under the mattress or in a hole in the garden. When it was suggested to Duffy that the banks would claim to be safe, he said, “I think people will not believe them.”
We don’t know exactly how many millions or even billions left the banking system on foot of that programme but it certainly helped serve to destabilise the State. That is money which you and I and every other taxpayer is on the hook for, because the banks are, indeed, safe. Sadly, they need to be or our society would collapse, taking our schools, our hospitals, our resource teachers and our special needs assistants with it.
MEANWHILE the producers of the Liveline show, which I enjoy, have come in for no serious investigation or enquiry and have continued to draw down high salaries, partly paid with money from the troika’s rescue package. And they haven’t stopped scare-mongering. In the spring of last year Joe Duffy told a woman affected by cancer that if she did not have access to the potentially life-lengthening drug “Ippy” in this State it was because we paid “the nameless faceless bond-holders of Anglo-Irish bank.”
Our management of our appalling and criminal banking collapse was, in fact, “textbook”, said Brian Lenihan in a Prime Time interview with Miriam O’Callaghan in 2010: “We followed the Swedish example. We guaranteed the banks. We set up an asset management company. Then we nationalised the bulk of the banking system.” But in Sweden there was all-party agreement, he said: “They didn’t have “nonsensical arguments in the public press or the media. They knew what they had to do and they did it.” Looking defiant and even angry, he went on: ” We did it against a background of irrelevant noise. And we’re getting on with it.”
In Ireland we have had virtually all-party agreement, dressed up as trenchant opposition and political revolution. That means that we can’t be honest with ourselves. But I believe that when it has come to it, our politicians have tried to do right by us.
What is far more serious is the “irrelevant noise” — self-interested, irresponsible, and deeply ignorant — which was allowed to dominate RTÉ when we needed our national broadcaster like never before.
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